A Health Savings Account (HSA) is an individually-owned, tax‐advantaged account that you can use to pay for current or future IRS‐qualified medical expenses. With an HSA, you’ll have the potential to build more savings for healthcare expenses or additional retirement savings through self-directed investment options¹.
If you have a qualified High Deductible Health Plan (HDHP) - either through your employer, through your spouse, or one you’ve purchased on your own - chances are you can open an HSA. Additionally:
When you open an account, HSA Bank will request certain information to verify your identity and to process your application.
Contributions made by all parties to an HSA cannot exceed the annual HSA limit set by the Internal Revenue Service (IRS). Anyone can contribute to your HSA, but only the accountholder and employer can receive tax deductions on those contributions. Combined annual contributions for the accountholder, employer, and third parties (i.e., parent, spouse, or anyone else) must not exceed these limits.2
Accountholders who meet these qualifications are eligible to make an HSA catch-up contribution of $1,000: Health Savings accountholder; age 55 or older (regardless of when in the year an accountholder turns 55); not enrolled in Medicare (if an accountholder enrolls in Medicare mid-year, catch-up contributions should be prorated). Authorized signers who are 55 or older must have their own HSA in order to make the catch-up contribution.
An HSA provides triple tax savings.3 Here’s how:
You can use your HSA to pay for a wide range of IRS-qualified medical expenses for yourself, your spouse, or tax dependents. An IRS- qualified medical expense is defined as an expense that pays for healthcare services, equipment, or medications. Funds used to pay for IRS-qualified medical expenses are always tax-free.
HSA funds can be used to reimburse yourself for past medical expenses if the expense was incurred after your HSA was established. While you do not need to submit any receipts to HSA Bank, you must save your bills and receipts for tax purposes.
Examples of IRS-Qualified Medical Expenses4:
Acupuncture Alcoholism treatment Ambulance services
Annual physical examination
Artificial limb or prosthesis
Birth control pills (by prescription)
Convalescent home (for medical treatment only)
Dental treatments (including x-rays, braces, dentures, fillings, oral surgery)
Disabled dependent care
Drug addiction therapy
Fertility enhancement (including in-vitro fertilization)
Guide dog (or other service animal)
Hearing aids and batteries
Lodging (away from home for outpatient care)
Pregnancy test kit
Prescription drugs and medicines (over-the-counter drugs are not IRS-qualified medical expenses unless prescribed by a doctor)
Prenatal care & postnatal treatments
Smoking cessation programs
Special education tutoring
Telephone or TV equipment to assist the hearing or vision impaired
Therapy or counseling
Medical transportation expenses
Vision care (including eyeglasses, contact lenses, lasik surgery)
Weight loss programs
(for a specific disease diagnosed by a physician – such as obesity, hypertension, or heart disease)
1Investment accounts are not FDIC insured, may lose value and are not a deposit or other obligation of, or guarantee by the bank. Investment losses which are replaced are subject to the annual contribution limits of the HSA.
2 HSA funds contributed in excess of these limits are subject to penalty and tax unless the excess and earnings are withdrawn prior to the due date, including any extensions for filing Federal Tax returns. Accountholders should consult with a qualified tax advisor in connection with excess contribution removal. The Internal Revenue Service requires HSA Bank to report withdrawals that are considered refunds of excess contributions. In order for the withdrawal to be accurately reported, accountholders may not withdraw the excess directly. Instead, an excess contribution refund must be requested from HSA Bank and an Excess Contribution Removal Form completed.
3 Federal Tax savings are available no matter where you live and HSAs are taxable in AL, CA, and NJ. HSA Bank does not provide tax advice. Consult your tax professional for tax‐related questions.
4 This list is not comprehensive. It is provided to you with the understanding that HSA Bank is not engaged in rendering tax advice. The information provided is not intended to be used to avoid Federal tax penalties. For more detailed information, please refer to IRS Publication 502 titled, “Medical and Dental Expenses”. Publications can be ordered directly from the IRS by calling 1-800-TAXFORM. If tax advice is required, you should seek the services of a professional.
5 Insurance premiums only qualify as an IRS-qualified medical expense: while continuing coverage under COBRA; for qualified long-term care coverage; coverage while receiving unemployment compensation; for any healthcare coverage for those over age 65 including Medicare (except Medicare supplemental coverage)
To maximize HSA tax and savings benefits, begin funding your account as soon as you can. HSA Bank offers several convenient methods for making contributions to your HSA.
Payroll Deductions – If your employer offers this option, HSA Bank will facilitate recurring pre-tax payroll deductions. Contact your employer to complete the appropriate paperwork.
Online Transfers – On HSA Bank’s member website, you can transfer funds from an external bank account, such as a personal checking or savings account, to your HSA.
Check – Mail your personal check and completed Contribution Form to: HSA Bank, PO Box 939, Sheboygan, WI 53082
Whether you want to reimburse yourself for an IRS-Qualified medical expense paid out-of-pocket or you want to pay directly from your HSA, HSA Bank offer multiple options for accessing your funds.
Health Benefits Debit Card – Your HSA Bank debit card from Visa® provides access to your HSA funds at point-of-sale with signature or PIN and at ATMs for withdrawals. Transaction fees may apply when used with a PIN.†
Checks – A book of 50 checks can be ordered upon request for an additional fee.† You can use these checks to pay providers or reimburse yourself for expenses already incurred. Online Transfers – On HSA Bank’s member website, you can reimburse yourself for out-of-pocket expenses by making a one-time or reoccurring online transfer from your HSA to your personal checking or savings account.
Online Bill Pay – Use this feature to pay medical providers directly from your HSA.
*The HSA Bank Mobile App is free to download. However, you should check with your wireless provider for any associated fees for accessing the internet from your device.
**You can pay for a wide range of IRS-qualified medical expenses with your HSA, including many that aren’t typically covered by health insurance plans. This includes deductibles, co-insurance, prescriptions, dental and vision care, and more. For a complete list of IRS-qualified medical expenses, visit irs.gov.
†For applicable fees, see your HSA Bank Interest and Fee Schedule or Explanation of HSA Bank Fee Changes document.